Mexico finds large shallow water oil fields

Mexican state energy giant Pemex announced its biggest exploration success in five years, the discovery of new shallow water oil fields that could yield 200,000 barrels per day.

The fields were found in four locations in the Gulf of Mexico and production could begin in around 16 months, helping Pemex reverse declining output, said company director Emilio Lozoya.

Altogether, the locations off the coast of Tabasco and Campeche states are estimated to contain 350 million barrels of light and heavy crude.

"This is great news for Pemex, the industry and our country," Lozoya told an oil conference in the western city of Guadalajara.

"It indicates that in a relatively short time, we will ... already be reversing the (declining) production curve," he said. "This is Pemex's biggest exploration success in five years."

The discovery could also produce 170 million cubic feet of gas per day.

The find comes a month before Mexico launches the first auction for other shallow water oil fields since it passed a historic reform in 2013 that opens the sector to foreign investors for the first time since 1938.

The 14 blocks are all in the Gulf of Mexico and several international energy firms have already lined up to bid for them on July 15.

Mexico aims to reverse declining oil production, which has fallen from 3.4 million barrels per day a decade ago to 2.4 million today.

Declining global oil prices have also hit Pemex, forcing the government to slash its budget and cut its growth forecast. Pemex lost $17.7 billion last year.